I really have a hard time remembering how to calculating those two, especially ERAT! reminds me of BORAT… anyway can someone tell me an easy way 2 remember the calculation? thanks.

Have you taken Exam 3 AM? They have a great real estate Q which goes over nearly every facet of both calcs. Try that test and study the answer key and you’ll know it well. Don’t forget the errata for that problem. T/G

CFAT = Pretax CF - Income tax payable = (NOI - debt service) - (NOI - interest expense - depreciation) * tax rate As for ERAT, I still can’t quite match the computation to the idea that is it a return measure for invested capital.

that schweser exam question is painful even with the answer key